ALAN D. AVILES
HHC PRESIDENT AND CHIEF EXECUTIVE
REPORT TO THE BOARD OF DIRECTORS
January 27, 2011
HHC FACILITIES ON TARGET TO RECEIVE MEDICAL HOME DESIGNATION
By the end of 2010, all of our acute care facilities and diagnostic and treatment centers submitted applications to the National Committee for Quality Assurance to receive designation as Patient-Centered Medical Homes. Another 27 of our community health sites have also applied. We will also be submitting applications for about six additional community sites. Thirteen of these submissions have been reviewed by NCQA and all were awarded the highest, Level 3 PCMH recognition. We are waiting for NCQA's review of the balance of our submissions, which should come during the months of February and March. The designations will ultimately qualify HHC for as much as $15 million annually in enhanced Medicaid reimbursement rate increases, if all of our primary care sites ultimately receive Level 3 NCQA certification.
FLU VACCINATION RATES LOWER THAN ANTICIPATED
We have been disappointed by the vaccination rates during this year's flu season, both in the community and among our employees. We believe that the low rates have been partly due to a mild and late onset of the flu season. There have also been unfounded anxieties, even among our own nurses, about this year's combination vaccine that offers immunization to the H1N1 virus as well as other seasonal flu viruses. Nearly 200,000 New Yorkers have received the vaccine in our facilities so far this season, as have nearly 15,000 HHC employees. The CDC has reported accelerating flu illness, since late December, and we remain hopeful that more HHC employees and other New Yorkers will take advantage of the availability of the vaccine and protect themselves during the remainder of the flu season.
Congress returned to session on January 5th. On Wednesday, January 19, the new Republican House leadership took up and passed by a vote of 245 to 189 a bill to repeal health reform. While such a bill was predicted to pass the House, it is unlikely to be taken up on the Senate floor, where the Democrats are still in the majority. The President delivered the State of the Union address on January 25 and indicated that he continues to be concerned about the cost of Medicare and Medicaid and specifically mentioned "medical malpractice reform to rein in frivolous lawsuits."
The Zadroga 9/11 Health and Compensation Act was passed by both houses of Congress at the very end of the lame duck session. The President signed the bill into law on Sunday, January 2, 2011. HHC and the City were intensely involved in lobbying efforts on behalf of the legislation, and are appreciative of our state’s Senators, Kirsten Gillibrand, the prime sponsor, and Charles Schumer, for shepherding the bill in the Senate as well as Reps. Jerry Nadler, Carolyn Maloney and Peter King in the House .
The new program that was enacted begins on July 1, 2011. The bill provides $4.3 billion in funding for both the health and compensation titles of the bill. It caps federal funding for the health program over five years at $1.5 billion (New York City will contribute 10% of the cost). Any funds not spent in the first five years may be carried over and expended in the sixth year of the program. HHC’s World Trade Center Environmental Health Center is one of several centers of excellence that can receive funding under the bill. The other centers are the Mt. Sinai consortium, the FDNY and Veterans Administration. The bill requires the Centers of Excellence to report claims data to HHS so that costs and utilization of services can be fully monitored. The bill also specifies the non-treatment services furnished by Centers of Excellence that can be funded under the health program (e.g. outreach, social services, data collection, development of treatment protocols).
GOVERNOR CUOMO LAYS OUT REFORM AGENDA IN
STATE OF THE STATE ADDRESS
In his first State of the State Address delivered at the beginning of the month, Governor Cuomo outlined a broad agenda that included, among many initiatives, caps on spending, state agency redesign and a Medicaid reform workgroup. In a break from tradition, Governor Cuomo invited legislative leaders to make remarks before his address in a show of bipartisanship and cooperation. Both Assembly Speaker Sheldon Silver and Senate Majority Leader Dean Skelos pledged to work cooperatively with Governor Cuomo on ways to close the $10 billion budget gap and achieve significant government reforms.
Stating that he wanted to change course and avoid the normal process of proposing Medicaid cuts only to see the Legislature restore them under intense pressure from the healthcare industry and advocacy organizations, the Governor announced that a Medicaid reform task force would be formed to come up with ways to redesign the program and save approximately $2 billion in Medicaid spending. The task force is headed by Jason Helgerson who formerly was the Medicaid program director in Wisconsin and has been tapped by Cuomo to serve in this post in New York, and Jim Introne, who is the Deputy Secretary for Health and Human Services. Members of the task force include hospital and labor representatives, GNYHA, HANYS, 1199, state agency staff, health insurance industry representatives, four members of the Assembly and Senate, and business and consumer leaders. Deputy Mayor Linda Gibbs represents the City of New York on the task force.
The task force is in the process of holding regional public hearings throughout the State. Meetings slated to take place today in Manhattan and the Bronx were cancelled due to the snowstorm and will be rescheduled. The state has also created a website to solicit recommendations from the public for redesigning the system, and to track the group’s progress. Recommendations from the task force are due to the Governor by March 1st.
MAYOR BLOOMBERG DELIVERS STATE OF THE CITY ADDRESS
Mayor Bloomberg delivered his 10th State of the City Address last week on Staten Island. Among the list of many prior year accomplishments and future challenges that lay ahead, the Mayor spoke about the need to expand economic development initiatives, achieve new savings in City government and modernize City government. A critical piece of the plan to modernize City government and achieve significant savings is that of pension reform. The Mayor is seeking changes that would allow pension benefits to be included in the collective bargaining process, creation of a new pension tier for new employees and consolidation of pension systems administration. Any change to the pension system would have to be approved by the State Legislature and the Governor. High on the list of federal agenda priorities is immigration reform. The Mayor talked about building a diverse coalition of business interests and elected officials to urge Congress to enact immigration reform this year.
While action on the State and Federal agendas plays out in Albany and in Washington, the Mayor committed to not raising taxes and maintaining fiscal discipline and vigilance at City Hall. The City budget has been reduced by nearly $5 billion over the past 3 years but multi-billion out year gaps still loom and will require close coordination with the City Council to realize necessary future savings.
CITY BUDGET RESTORATIONS
The Mayor and the City Council earlier this month came to agreement on budget restorations to PEG (Program to Eliminate the Gap) proposals that were included in the City’s November budget plan. Two November Plan PEGs affecting HHC were restored -- specifically, $168,750 in Council funding for HHC’s Expanded HIV Testing program and $421,875 in Council funding to support HHC’s Child Health Clinics. We are grateful to the Mayor and the Council for their ongoing strong support of HHC.
STATUS OF CAPITAL BUDGET TARGET REDUCTIONS
HHC and the NYC Office of Management and Budget (OMB) are still discussing options available in achieving the targeted reductions of 20% to our capital program for Fiscal Years 2011 through 2021. We continue to work closely with OMB to preserve the most essential components of our capital program. At present, we have not submitted the full target reductions requested.
At the core of our discussions is the need to continue to adequately fund the completion of the Harlem and Gouverneur Major Modernizations, while at the same time trying to maintain funding for other essential projects, including the emergency department expansion at Lincoln and Women’s Health Pavilion at Elmhurst. We also are attempting to preserve the funding necessary to protect and maintain our existing infrastructure.
We expect to complete our discussions with OMB sometime over the next several weeks. A complete status report will be provided at the Board's next Capital Committee meeting.
PARTICIPATION IN THE AUCTION OF ASSETS AT
ST. VINCENT’S MEDICAL CENTER
Last month I authorized a deviation from our procurement policy to permit participation in a five-day live auction of hospital assets from the former St. Vincent’s Catholic Medical Center. Current operating procedures do not permit participation in an auction process. A revised operating procedure to address auction opportunities will be included in the larger procurement reform currently underway. HHC's participation in this auction was spurred by a Capital Committee recommendation and yielded substantial savings for several of our facilities. Based on this experience, we will continue to try to take advantage of any similar opportunities in the future.
KINGS COUNTY MEDICAL DIRECTOR APPOINTED TO PRESTIGIOUS
HEALTH IT COMMISSION
Dr. Abha Agrawal, Medical Director at Kings County Hospital Center, has been appointed as a Commissioner to the Certification Commission for Health Information Technology (CCHIT). She will serve a two-year term on the 19-member board selected from a nationwide pool of candidates. Certifying electronic health records (EHRs) since 2006, the Commission established the first comprehensive, practical definition of what capabilities are needed in these systems, and has been officially recognized by the federal government as a certifying body. Congratulations to Dr. Agrawal for this national recognition of her significant leadership in Health Information Technology.
MARC BARD, MD, NAMED EXECUTIVE DIRECTOR OF PAGNY
The Physician Affiliate Group of New York, P.C. (PAGNY) has named Marc Bard, MD as its Executive Director. As you know, PAGNY currently employs our physicians at several HHC facilities. Dr. Bard has assumed the day to day leadership of PAGNY and will provide strategic direction for ensuring its success.
Dr. Bard most recently was the Managing Director in Navigant Consulting’s Healthcare practice, and is a nationally regarded expert on physician leadership effectiveness, change management, and organizational design. He has served as a consultant to leading academic medical centers, faculty practices, medical groups, community hospitals, and individual healthcare executives, focusing on physician integration, clinical strategic planning and performance improvement.
We welcome Dr. Bard to his new position. I am confident that under Dr. Bard’s leadership PAGNY will be a strong collaborative partner in advancing HHC’s strategic goals and in ensuring that our physicians play an active and assertive role in our evolution toward a highly competitive Accountable Care Organization in a post-healthcare reform environment.
FRANK CIRILLO RETIRES AFTER THIRTY YEARS OF SERVICE
After thirty years of service, Frank Cirillo, Senior Vice President and Chief Restructuring Officer, has retired from HHC. Mr. Cirillo served HHC in several important roles over his long career. For more than 10 years, he served as Senior Vice President of Operations, with wide-ranging responsibilities, including the negotiation of our affiliation contracts with medical schools and physician professional corporations for the services of more than 7,000 physicians, technicians and other clinical care providers. He also led HHC negotiations, along with the City Office of Labor Relations, on collective bargaining agreements with a multiplicity of unions collectively representing tens of thousands of HHC workers. And he has led innovative supply chain and other contracting initiatives that substantially lowered HHC’s operating costs.
I am personally grateful to Mr. Cirillo for deferring his planned retirement in 2009 and agreeing to undertake the challenging role of Chief Restructuring Officer. In that role, Frank contributed greatly to the crafting of a thoughtful cost-containment and restructuring blueprint for closing a $1.2 billion budget gap, while remaining faithful to our mission. Frank has been the consummate public servant and has earned the respect and affection of his HHC colleagues. We will miss him and wish him all the best in the years ahead.
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